States asked to apply for unemployment insurance test plan

WASHINGTON — The Obama administration is looking for states that will experiment with unemployment insurance programs by letting people test a job while still receiving benefits.

The plan is a key feature of a payroll tax cut package that President Barack Obama negotiated with congressional Republicans in February.

The Department of Labor will open the application process Thursday for 10 model projects across the country. Any state can apply for the "Bridge to Work" program.

The plan is modeled after a Georgia program called "Georgia Works." Under the plan, workers who have lost jobs can be placed in other temporary jobs as trainees for short periods to retain their skills or gain new ones while receiving jobless assistance. About a third of the time, those workers wind up getting hired full-time.

A number of states are combining unemployment benefits with on-the-job training, including North Carolina, New Hampshire, Utah and Missouri.

A senior administration official said those states would be eligible to apply for the federal demonstration project. The official spoke on condition of anonymity to describe the program before an administration announcement.

States that are chosen could get waivers from the federal government allowing them to tap their unemployment insurance accounts to pay for such costs as transportation for workers in temporary jobs.

The program has had mixed results in some states that have their own programs. Administration officials said they hope the waivers and assistance offered by the federal demonstration projects could help rectify any problems that have emerged.

Supporters of the programs say it helps workers retain or learn new skills and add new job references to their resumes. The plan passed with support from leading Republicans, including House Speaker John Boehner and House Majority Leader Eric Cantor.

It also is designed to answer critics of unemployment benefits who say the aid discourages some people from aggressively seeking work.